Introduction - Country by Country Reporting - International Taxation - Income Tax

Introduction In keeping with India s commitment to implement the recommendations of 2015 Final Report on Action 13, titled Transfer Pricing Documentation and Country-by-Country Reporting , identified under the OECD Base Erosion and Profit Shifting (BEPS) Project, section 286 of the Income-tax Act, 1961 ( the Act ) was inserted vide Finance Act, 2016 , providing for furnishing of a Country-by-Country report (CbCR) in respect of an international group by its constituent or parent entity. The due date for furnishing the Country-by-Country Report is the date specified under section 139(1) for furnishing the return of income for the relevant accounting year. FY 2016-17 will be the first reporting year for furnishing of CbCR. The rules for furnishing of CbCR are also still under consideration. Hereby extends the due date prescribed therein for furnishing of report in respect of international group for reporting accounting year 2016-17 to 31st March, 2018. [ Circular No. 26/2017 dated 25.10.2017 read with Press Releases issued as on 23.03.2018 ] The salient features of the Country-By-Country Report and Master File rules [ Press Release issued as 01.11.2017 ] The threshold for the Country-By-Country Report is total consolidated group revenue of [upto 31.02.2021 ₹ 5,500, From 01.04.2021 is 6400 crore or more, specified under rule 10DB ] . The threshold for the Master File is consolidated group revenue exceeding ₹ 500 crore and either the aggregate value of international transactions as per the books of accounts exceeding ₹ 50 crore or aggregate value of international transactions in respect of intangible property exceeding ₹ 10 crore. Report of Master File has to be submitted in Form 3CEAA and the Country-by-Country Report in Form 3CEAD. An international group having multiple Indian constituent entities may designate one constituent entity to file the Master File. Part A of Form 3CEAA is to be filled by every constituent entity of an international group regardless of whether it qualifies under the threshold for furnishing Master File. However, to reduce the compliance burden, such international group having multiple Indian constituent entities can designate one constituent entity to file Part A on its behalf. Form 3CEAD for furnishing Country-by-Country Report follows OECD template.